# In the matter of MSA Developers Private Limited

> NCLT judgment dated 2023-10-13. Citation: TCN-2023-NCLT-01250. The Deputy Commissioner of Income Tax filed an application seeking to set aside a rejection of…

- **Court:** NCLT
- **Order date:** 13 Oct 2023
- **Citation:** TCN-2023-NCLT-01250
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/msa-developers-private-limited-30e09508

## Summary

### Background

The Deputy Commissioner of Income Tax filed an application seeking to set aside a rejection of their claim by the Resolution Professional (RP) in the Corporate Insolvency Resolution Process (CIRP) of MSA Developers Private Limited. The claim, amounting to Rs. 119,17,91,261/-, represented statutory dues for Assessment Years 2014-15 to 2017-18. The RP rejected the claim as time-barred, citing delays in filing after the public announcement and the extended period under IBBI regulations. The Income Tax Department argued that the RP was aware of the ongoing assessment proceedings and failed to consider the tax dues before the resolution plan was approved by the Committee of Creditors (CoC).

## Facts

A survey operation under section 133(A) of the Income Tax Act, 1961 was conducted on 2016-08-03 on MSA Developers & Others Group of Companies. The group was found to be involved in bogus/ inflated purchases/ services. The case of the Corporate Debtor was selected under “CASS" for scrutiny assessment. Notices under section 143(2) of the Income Tax Act, 1961 were issued on 2017-03-31 for A.Y. 2016-17 and on 2018-08-09 for A.Y. 2017-18. The assessment proceedings for Assessment Year (A.Y.) 2016-17 was completed on 2019-08-13 and a demand notice for Rs.45,52,43,910/- was served upon Corporate Debtor. The CIRP of the Corporate Debtor, M/s MSA Developers Pvt. Ltd. was initiated vide an application filed under Section 7 of the Insolvency and Bankruptcy Code, 2016

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## Issues and analysis

### Issue 1: Whether the delay in filing the claim by the Deputy Commissioner of Income Tax should be condoned, …

**Ratio:** The IBC is a time-bound process, and claims must be submitted within the stipulated time

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**Reasoning:** The NCLT reasoned that allowing claims after the approval of the resolution plan would

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**Interpretation:** The interpretation of Section 31(1) of the IBC and related regulations

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**Application:** In this case, the Deputy Commissioner of Income Tax filed the claim after the

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## Parties

- **Judges:** SHRI. BACHU…; RAHUL BHA…
- **Appellants:** Ravinder Ag…
- **Respondents:** MSA Developers…; M/s. MSA Developer…

## Timeline

- **2016-08-03 — Survey Ope…**: A survey operation under section 133(A) of the Income Tax Act, 1961 was conducted on MSA…
- **2017-03-31 — Notice under Income Tax…**: Notices under section 143(2) of the Income Tax…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 60(5) — Adjudicating Authority for corporate persons](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-60)

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